Editorial: Why Japan's Electricity Crisis Matters

You may not read about it on the front page of the newspapers, but Japan is undergoing a second electricity crisis. The first took place last spring and summer after the Fukushima earthquake, tsunami, and subsequent meltdown of multiple nuclear power plants. That power crisis mostly affected Tokyo and northern Japan. This second crisis affects all of Japan, and it has implications for the United States (and the world) at many different levels.

From an energy perspective, Japan is (at least temporarily) abandoning nuclear power—30% of its generating capacity—and replacing it with conservation and still-to-be-determined alternative sources. No country has faced such a rapid transition, so Japan's successes and failures will be a lesson to us as we contemplate an exit from nuclear (or perhaps even coal). In the short run, Japan has switched to older oil- and gas-fired power plants, leading to a jump in oil and liquified natural gas (LNG) imports. Those increased imports have nudged up the prices you pay for oil and gasoline. Ironically, the facilities that the United States was building to import natural gas may now be used to export LNG to Japan and other countries hungry for clean fuels. That’s another reason natural gas prices in the United States won’t fall as much as you may have been led to believe.

Fashion designers in Tokyo have developed new textiles to help the Japanese keep their cool at higher indoor temperatures. Those highly breathable fabrics will no doubt soon appear in North America! (AP)

Electricity conservation will also be used to balance the grid in the short term, and it is this aspect of the crisis that should most interest Home Energy readers. Last year the shortages were concentrated in Tokyo, and Tokyo residents successfully cut demand by almost 15%. This year, nearly all regions of Japan will have inadequate capacity during the summer peak, though ironically, Tokyo is in the best shape this year. Watch for blackouts in Kansai.

The responses to last year’s shortage are already being felt globally. For example, sales of LEDs skyrocketed when both residential and commercial customers scrambled to cut demand while maintaining high-quality illumination. Tokyoites were willing to pay a premium because they were more concerned about meeting their target reductions than about finding cost-effective solutions. As a result, increased sales have pulled LED prices down the cost curve at least a year faster than expected. This translates into LEDs that are cheaper for U.S. customers. Just as important, fixture designers have been linking those LEDs to wireless controls in ways that adjust output to actual lighting needs. Japan now expects to fully replace CFLs by 2030, with a large fraction of illumination supplied by an entirely new technology—organic LEDs.

To save air-conditioning energy and peak power, Japanese offices and homes now operate at higher thermostat settings. The ever-creative fashion designers in Tokyo have developed new textiles and clothing styles to help the Japanese keep their cool at higher indoor temperatures. Those highly breathable fabrics will no doubt soon appear in American specialty stores and then perhaps in Walmart. Japanese consumers are also buying PV to reduce their demand for grid-supplied electricity. This won’t lower the price of PV—that’s mostly determined by China—but you may eventually see new types of installations or components. Japanese utilities typically require PV users to install batteries; this raises the price but it is also stimulating different types of PV packages and connected appliances. There are dozens of other energy-saving gadgets, ranging from clever to silly, some of which will successfully cross the Pacific.

A political deadlock prevents Japan from committing to either a nuclear or a renewables solution. The central government and industry leaders believe in nuclear power as the only feasible choice, while much of the public has lost faith in the utilities and the institutions that regulate them. Many of the same trends are visible in the United States. But one thing is clear: The Japanese crisis will be the mother of many new and ingenious ways to save electricity.

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Reducing PEAK demand is critical when generating capacity is limited. If it's the fuel source that's limited then reducing overall demand is more important. In the US it's generating/grid capacity that limits power.